What is conversational AI? A guide to real-time voice

Real-time voice is changing how teams think about automation. Instead of static IVRs, clunky chatbots, or manual agent workflows, companies are building faster, more natural experiences that scale.

That means shorter wait times, higher containment rates, and better customer experiences without adding headcount.

The difference? Infrastructure. Voice AI only works when every part of the pipeline, from speech to intent to response, runs in real time, without lag or loss. That’s where most tools typically fall short and where Telnyx stands out.

In this post, we’ll look at how conversational AI works, what’s driving the shift to voice, and why full-stack performance matters more than ever.

What is conversational AI?

Conversational AI is a type of artificial intelligence that enables machines to interact with people in natural, human-like ways. It encompasses both text-based chat interfaces, such as website chatbots, and voice-based systems, including phone assistants and interactive voice response (IVR) systems.

This post focuses specifically on voice AI, where performance, latency, and infrastructure matter most. While text-based conversations can also occur in real time, slight delays are less noticeable. In voice interactions, even small amounts of latency can disrupt the experience, creating challenges that many platforms are not built to solve.

Although conversational AI initially centered around text-based chatbots, the biggest gains are now happening in voice. This shift moves away from rigid IVR menus and scripted flows toward more open-ended, responsive conversations, where real-time performance and infrastructure directly shape the user experience.

Voice feels faster, more human, and more flexible than typing. While many prefer texting for everyday inquiries, calling becomes the go-to when people need quick answers, like reporting a suspicious charge to a bank or checking the status of an online order.

As AI models become increasingly smarter and companies look to automate customer interactions, voice-first automation is shifting from a nice-to-have to a business-critical requirement. In fact, it can improve productivity by 66%. But for voice AI to actually work well, communication needs to happen in real time.

That’s where most solutions fall short. Let’s take a look at some popular voice AI platforms and how they perform.

Top voice AI platforms

The voice AI space has a growing number of startups and APIs focused on speech and interaction. Some of the most talked-about platforms today include:

ElevenLabs

Specializes in ultra-realistic text-to-speech. Great for generating lifelike voices, but doesn't offer a complete stack for building real-time, two-way voice experiences.

Vapi

Offers a voice agent API designed for quick prototyping and call automation. Built on top of third-party speech and telephony providers, which limits performance and control.

Bland.ai

Focuses on outbound voice automation using pre-built voice agents. Works well for basic call flows, but lacks flexibility and full-stack infrastructure.

Together AI

Provides open-weight language models and inference infrastructure. Powerful for developers building with LLMs, but not purpose-built for telephony or voice streaming.

Telnyx

Provides a full-stack Voice AI platform with licensed telephony, real-time audio streaming, edge-hosted inference, and programmable APIs. Ideal for developers building real-time, two-way voice experiences with low latency and complete control.

Unlike other platforms, Telnyx owns its infrastructure end-to-end, eliminating third-party dependencies and enabling faster, more reliable voice interactions.

How voice AI works

Voice-based conversational AI follows a simple process. A person speaks into a phone or app. That audio is transcribed into text using automatic speech recognition (ASR). Natural language processing (NLP) analyzes the intent behind the words. Then, a decision engine or language model generates the appropriate response, which is spoken back to the user using text-to-speech (TTS).

Unlike chatbots or text-based AI, voice leaves no room for delay. All of this has to happen in milliseconds. Any lag, and the conversation feels broken.

The problem? Most systems stitch together third-party tools for voice APIs, ASR, NLP, and even the underlying network. That adds latency, increases complexity, and makes it harder to maintain a natural flow.

Integrated platforms like Telnyx, which handle voice, AI, and telephony in one place, can stream audio, process speech, and deliver responses more efficiently. The result is ultra-low latency, bi-directional streaming, and fewer points of failure.

Voice AI use cases across industries

Whether you’re an engineer building a voice agent, a CX lead trying to reduce support costs, or an IT leader looking for secure automation, Voice AI offers fast wins across various industries. Here’s what it looks like in the real world:

Finance and insurance

Voice AI is helping financial services teams deliver faster, more secure interactions.

Use cases:

• Authenticate customers using voice biometrics
• Send real-time fraud alerts during or after a call
• Automate balance checks, payment reminders, and claim status updates

Example: A digital bank uses voice AI to trigger fraud detection workflows based on keywords or sentiment mid-call, reducing response times from minutes to milliseconds.

Healthcare

Healthcare providers are simplifying patient interactions while staying compliant.

Use cases:

• Automate appointment reminders and confirmations
• Route calls by language or department
• Surface patient data and history for agents in real time

Example: A multilingual clinic uses voice AI to detect spoken language on inbound calls and route patients to the appropriate support team without manual input.

Marketing, CRM, and sales tools

Sales and marketing teams use voice AI to qualify leads, support reps, and expedite follow-ups.

Use cases:

• Score and qualify leads based on call content
• Stream call audio to CRMs and log intent in real time
• Provide in-call prompts and next steps for reps

Example: A SaaS provider integrates voice AI into their CRM, enabling them to immediately surface call summaries and objections after every inbound sales call, eliminating the need for manual note-taking.

Travel and hospitality

Travel and hospitality brands are using voice AI to deliver smoother experiences and support customers on the go.

Use cases:

• Automate booking confirmations, updates, and cancellations
• Route urgent issues, like lost luggage or missed flights, to live agents
• Offer multilingual support for international travelers \

Example: A hotel chain implements voice AI to detect guest intent during calls—whether they're checking availability, requesting amenities, or reporting an issue—automatically routing them to the right department without menu trees or long wait times.

Voice AI is evolving fast

Voice AI is advancing quickly—from simple automation to real-time assistants that personalize, adapt mid-call, and guide agents with contextual insights. Future systems will integrate voice, text, and visual interfaces, necessitating infrastructure that can support multimodal, real-time interaction.

Platforms with full control over the voice and AI pipeline—like Telnyx—are already powering this shift, helping teams move faster with fewer constraints.

What makes Telnyx different

When you're building real-time voice applications, control over performance, latency, and infrastructure is non-negotiable. Most platforms offer one piece of the puzzle, leaving developers to stitch together telephony, ASR, TTS, and AI inference from multiple vendors. That adds complexity, introduces latency, and limits your ability to optimize the experience.

Telnyx takes a different approach. We provide a vertically integrated stack—carrier-grade voice, built-in speech capabilities, edge-hosted inference, and developer-first APIs—all in one programmable platform. That means fewer moving parts, faster execution, and full visibility from the network to the model.

One integrated stack for real-time voice

While most providers rely on third-party tools for key functions, Telnyx handles the entire pipeline in-house. Here's how that compares to a stitched-together solution:

By reducing handoffs and running real-time voice over our private backbone, we help teams deliver responsive, reliable experiences without the overhead.

Built for developers, optimized for scale

Whether you're building from scratch or integrating with existing systems, Telnyx gives you the flexibility to move fast:

• API-first design for full control over media and interaction
• Support for open-source or bring-your-own models
• Streaming and event hooks for real-time responsiveness
• Compatible with SIP, WebRTC, and popular dev stacks

Start a bi-directional audio stream with just a few lines of code:

Secure, compliant, and enterprise-ready

At Telnyx, security and compliance are baked into the stack. All voice data is encrypted in transit using TLS and SRTP, transmitted over a private MPLS network, and stored in secure environments aligned with HIPAA, PCI, and GDPR standards. With built-in fraud prevention and geo-redundant failover, you get the reliability of an enterprise-grade stack without adding more vendors.

Whether you're automating conversations, scaling virtual agents, or modernizing contact centers, Telnyx provides the infrastructure and tools to build faster, deploy smarter, and scale with confidence.

FAQs about conversational AI

What’s the difference between conversational AI and voice AI?

Conversational AI refers to any AI system that enables natural back-and-forth communication, whether through text or voice. Voice AI is a subset of conversational AI that focuses specifically on real-time spoken interactions, such as phone calls or voice assistants. Voice AI brings added complexity: processing speed, audio quality, and latency all have a direct impact on the user experience.

How is conversational AI different from chatbots or IVR \

Traditional chatbots and IVRs follow rigid scripts and rule-based logic. That means they can only respond to predefined inputs. Voice AI is more flexible and intelligent. It uses natural language understanding and machine learning to interpret meaning, adapt to context, and generate dynamic responses. Where a chatbot might fail with a slightly misspelled message or an IVR might trap users in a menu maze, voice AI can carry on a natural, open-ended conversation, especially when powered by real-time voice infrastructure.

How does voice AI work in real time?

Real-time voice AI starts with capturing the user's audio. That audio is transcribed using ASR (automatic speech recognition), the text is analyzed with NLP to determine intent, and an LLM or decision engine generates a response. The reply is then turned into speech with TTS (text-to-speech). This entire loop needs to happen in milliseconds to feel natural, and that’s only possible with integrated, low-latency infrastructure like Telnyx.

Why does infrastructure matter in voice AI?

Every millisecond matters in a voice interaction. When your AI stack relies on third-party APIs for speech processing, language modeling, and telephony, each handoff introduces latency and increases the risk of failure. Telnyx eliminates those bottlenecks with a full-stack solution: licensed global voice, edge-hosted inference, and private network routing all in one place.

What makes Telnyx different from other voice platforms?

Most voice platforms only handle telephony or rely on third parties for speech and AI processing. Telnyx is different. We provide the entire stack—carrier-grade voice infrastructure, real-time ASR and TTS, and programmable AI orchestration—all over a private MPLS network. That means better call quality, faster response times, and more control.